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Improving access to medicines in developing countries through local pharmaceutical production is at the centre of a project involving several institutional actors working on health and trade. Technology transfer is key to local production, but some prerequisites like a favourable policy environment and the ability of developing countries to use technology transfer are essential to encourage local production, according to participants in the project.

The joint project between the United Nations Conference on Trade and Development (UNCTAD), the World Health Organization (WHO), and the International Centre for Trade and Sustainable Development (ICTSD) was presented on 18 May, on the side of the annual World Health Assembly.

The project is aimed at improving access to medicines, vaccines and diagnostics for poor populations in developing and least developed countries.

Funded by the European Union, the project also aims at promoting the transfer of technology to developing countries, said Zafar Mirza, coordinator of the WHO Department of Public Health, Innovation and Intellectual Property.

The project was articulated in two phases, he said, the first one was meant to deepen the understanding, and develop a good insight into the state of production in developing countries. Phase one of the project runs from 2009-2011.

A number of activities were carried out, Mirza said, including the undertaking of a survey of trends in local production and technology transfer in developing countries, the preparation of a broad overview of local production and technology transfer initiatives in those countries, and conducting regional and inter-regional consultations with stakeholders involved in local production and technology transfer.

Phase one is nearly complete, he said. The second phase is meant to develop capacities so that developing countries can undertake local production and transfer of technology. The main focus of WHO is to find out the gains for public health in promoting local production.

It is necessary to develop a public health-based framework so that when new local production takes place, it is under well-stated public health objectives, he said.

[Updated:] Phase two of the project will start in November 2011 and will be focused on capacity-building, Mirza told Intellectual Property Watch later, and aimed at policy level. One of the objectives will be to find policy coherence between industrial policy and public health policy and to help policymakers identify specific local needs, he said.

Before the end of October, eight publications will be issued on the work done during phase one, he said, including case studies, global trends of local production in developing countries, and a landscape study.

According to Kiyoshi Adachi, UNCTAD legal officer and chief of the IP Unit, Investment Capacity-Building Branch, the first phase of the project provided an important perspective. Case studies were carried out in eight countries: Argentina, Bangladesh, Colombia, Ethiopia, Indonesia, Jordan, Thailand, and Uganda.

Regional meetings were organised to collect information directly to learn about the issues met by local producers, he said. This was a conscious choice, he said, to get a wide variety of situations and products with a geographical spread. UNCTAD did not want to replicate research or writing on that topic already published on China or India, he said.

A key finding is that there is a wide variation in pharmaceutical production in developing countries. The reality in 2011 goes beyond India, China and Brazil, he said, as many countries are involved in pharmaceutical production.

Another finding of the research was that South-South investment is as important as North-South investment.

Also, the overall local policy environment, such as drug policies, industrial policies, intellectual property regulations, procurements and insurance, are very important, Adachi said, as in a majority of cases the private sector is responsible for the production.

Finally, the absorptive capacity for technology is a basic requirement, he said. Unless there are basic human resources with some level of scientific capacity, such as in pharmacology, “nobody is going to be interested” in manufacturing pharmaceutical products, he said.

Policy environment shapes how local production takes place, he said. Greater access can result from more synergies between health and industrial policies, he added.

Consultations Unveil Regional Assets and Challenges

ICTSD held three regional stakeholder consultations as part of the project, said Ahmed Abdel Latif, senior programme manager for innovation, technology and intellectual property for ICTSD.

The aim of those consultations was to identify the main challenges, technical assistance needs and recommendations to facilitate technology transfer in local production, he said. They were held in Cape Town, South Africa in December 2009, in Buenos Aires, Argentina, in March 2010, and in Kuala Lumpur, Malaysia, in April 2010.

Those consultations provided a closer regional perspective from people engaged in technology transfer and local manufacturing, and allowed close and active cooperation with local partners, he said.

In Africa, the consultation results found that the production value is highly concentrated in a few countries, with South Africa accounting for over 70 percent. In addition, a growing number of developing countries transfer technology to African pharmaceutical producers, and a large part of the technology transfer is focused on HIV/AIDs, and malaria.

Other diseases need to be included in that transfer, Latif said. Common obstacles are small markets, poor infrastructure, inadequate human resources, and low investment in research and development in the region, he said.

In Latin America, the region has the capacity for manufacturing active pharmaceutical ingredients and bulk drugs, but skills are lacking in negotiating highly sophisticated technology transfer licences and there is a lack of support to train scientists in applied sciences and product development, Latif said.

In Asia, there are suitable human resources, trade and drugs policies are crafted to facilitate local production, and government policies exist to promote the pharmaceutical sector and local producers. But common obstacles are insufficient regulatory and economic incentives, lack of coordination among local authorities, and comparatively small research and development budgets that makes it difficult for local companies to compete with multinational companies.